Northrop Grumman Corporation
) received a contract from the U.S. Army Aviation and Missile
Research Development and Engineering Center to develop a navigation
grade inertial system for the Defense Advanced Research Projects
Agency (DARPA). Northrop has been receiving quite a many Department
of Defense (DoD) contracts given its diversified product portfolio.
Per the latest contract, the company will develop a miniaturized
inertial measurement unit for the Chip-Scale Combinatorial Atomic
Navigator program by combining bulk acoustic
micro-electro-mechanical system gyro and nuclear magnetic resonance
(NMR) gyro technologies. Notably, in addition to improving the NMR
gyro technology a new precision optical accelerometer will be
developed under this program. The initial value of the contract is
$0.65 million which can go up to $13.4 million if multiple options
This cost-effective microsystem is designed to reduce the size,
weight and power of navigation systems. This system will ensure
uncompromised navigation for warfighters, and lower dependence on
Global Positing System and other external signals.
Recently, this Zacks Rank #3 (Hold) stock was able to seal a huge
DoD contract, regardless of the sequestration effect. Northrop
Grumman received a contract worth $9.9 billion from the U.S. Air
Northrop continues with its R&D to develop new systems and
technology, which give the country an edge in hostile situations.
In 2013, the company's capital expenditure increased 10.0% from the
year-ago level. In 2014, the company expects capital expenditure to
jump 64.8% to about $600.0 million.
In the first quarter of 2014, Northrop's earnings comfortably
surpassed the Zacks Consensus Estimate by 11.6%. During the first
quarter earnings release the company increased its diluted earnings
per share guidance for 2014 to $8.90-$9.15 from the prior range of
$8.70-$9.00. The Zacks Consensus Estimate for 2014 is pegged at
Investors interested in the defense industry may consider
better-ranked stocks like
Leidos Holdings, Inc.
Lockheed Martin Corporation
). While Embraer SA holds a Zacks Rank #1 (Strong Buy), Leidos
Holdings and Lockheed Martin hold a Zacks Rank #2 (Buy).
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NORTHROP GRUMMN (NOC): Free Stock Analysis
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